Osteoarthritis (OA) of the knee is a common clinical condition and an important cause of physical disability in older people. At present the mainstay of treatment is symptom relief with anti-inflammatory drugs but such an approach has little effect on disability and does not later the pathophysiology of the disease process. A significant part of the physical disability associated with knee osteoarthritis is due to muscle weakness, aerobic deconditioning, and altered gait mechanics. Short term studies indicate people with knee OA have improvement in these physiologic parameters with exercise and that disability may be improved as well. The primary aim of the study is to determine if either a strengthening or aerobic exercise program (compared to control) will prevent or improve physical disability as measured by self report and performance measures in older patients with osteoarthritis of the knee for up to two years. Secondary aims of the study ar to determine the relationships between measures of physical disability and physiologic measures, to compare the efficacy of the strengthening exercise program vs. an aerobic conditioning program, to determine the effects of the strengthening and aerobic exercise program on symptoms and radiographic features of the disease, determine the effects of both exercise programs on health quality of life, to determine the cost effectiveness of a strengthening and aerobic exercise program as a treatment modality and to determine factors associated with compliance with therapeutic exercise. If exercise is demonstrated to be beneficial over the long term it will offer an important therapeutic intervention for a common and disabling disease of older people.